Continued moderate growth in output
Contacts in Norges Bank's regional network reported moderate output growth over the past 3 months and broadly unchanged capacity utilisation. There are prospects of continued moderate growth ahead.
Output growth was slightly lower than contacts' expectations in May. Cost-reductions in petroleum-related manufacturing and a decline in housing construction had a dampening effect on growth. At the same time, an increase in public investment contributed to growth, particularly in construction and commercial services. Growth has been strongest in the export industry.
Overall, there are prospects of higher growth in the next six months, driven in particular by an increase in infrastructure investment and housing construction. Lowest growth was expected by manufacturing industries, and oil industry suppliers anticipated lower output volume through autumn.
Overall capacity utilisation was little changed, although several contacts in manufacturing and the service sector reported a reduced supply of labour in some occupational categories. Employment growth was approximately the same as in the previous survey. Contacts expected a slight pickup in employment growth ahead.
Contacts estimated annual wage growth in 2014 at slightly below 3½ percent. Differences in wage estimates across sectors were still relatively small.
Information was provided by 317 regional network contacts in this survey. The interviews were conducted in August.
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